Written by Holding Redlich Practice Director for Migration, Rebecca Macmillan
The Australian Government has announced a significant shift in Australia’s migration framework with the introduction of the Core Skills stream of the new Skills in Demand (SID) visa. As of 7 December 2024, the SID visa has replaced the subclass 482 Temporary Skills Shortage (TSS) visa.
This forms part of the Australia Government’s broader 2023 Migration Strategy, which lists five core objectives – raising living standards, ensuring fairness in the workplace, building stronger Australian communities, strengthening international relationships, and delivering a system that is fast, efficient, and fair. This strategy has been designed to streamline the process for businesses to address workforce shortages.
A key feature of this overhaul is the implementation of the Department of Home Affairs’ new Core Skills Occupation List (CSOL), which will apply to both the Core Skills stream of the new visa and the subclass 186 Employer Nomination Scheme visa in the Direct Entry stream.
These changes are part of the Migration Amendment (2024 Measures No.1) Regulations 2024, which aim to address critical shortages and modernise Australia’s migration framework.
New visa requirements and streamlined process
The new SID visa, which replaced the TSS visa while retaining the 482 subclass number, introduces a simplified application process to address inefficiencies in the current system by reducing administrative burdens and facilitating faster decision-making, which benefits both employers and applicants.
Existing short and medium-term streams of the TSS visa will be replaced with the following:
- Specialist Skills stream for applicants in any ANZSCO occupation earning $135,000 or more (excluding occupations in ANZSCO major groups 3, 7 and 8)
- Core Skills stream for applicants earning more than $73,150 in an occupation on the CSOL
- Labour agreement stream which carries over existing settings from the TSS visa while further development of the proposed Essential Skills stream takes place.
The new SID visa can be granted for up to four years with an English language requirement of an IELTS 5 with a score of at least five in each part of the test (or equivalent). There is also the introduction of a financial capacity requirement for employers, who must be able to demonstrate that they can pay the proposed salary for each year nominated. For example, if you nominate a person for four years, you must demonstrate the financial capacity to pay the salary for those four years.
Reduced work experience requirements
Under the new Core Skills stream, the minimum work experience requirement has been reduced from two years to one, with the experience needing to be obtained within five years prior to the application. This adjustment lowers barriers for skilled workers, making it easier for individuals with in-demand skills to qualify for migration.
By shortening the experience requirement, the program aims to attract a younger, more diverse pool of talent while addressing immediate labour market shortages.
New CSOL consolidation
The CSOL consolidates previous, complex occupation lists into a single, comprehensive list covering 456 occupations, including finance managers, software engineers and cybersecurity professionals. This expanded coverage provides greater opportunities for both employers and skilled migrants, offering temporary and permanent migration pathways for a broader range of professions.
Pathway to permanent residence
Applicants for the subclass 186 Employer Nomination Scheme visa in the Temporary Residence Transition stream are no longer required to have worked for their sponsoring employer for two years. Any employment on a subclass 482 visa will satisfy the requirement.
The CSOL list is also available for the subclass 186 Employer Nomination Scheme visa in the Direct Entry stream, offering a direct path to permanent residence for more occupations.
Changes to sponsorship obligations
Because TSS and SID visa holders have more mobility, amendments have been introduced that end a sponsor’s responsibility to ensure a sponsored worker remains in their nominated occupation once employment ends.
Building on past migration changes
In the first half of 2024, The Australian Government introduced several significant changes to the migration system aimed at addressing labour market needs. According to the 2024 Occupation Shortage List (OSL), 33 per cent of assessed occupations (303 out of 916) are currently suffering a skills short fall. While this is a small improvement from the 2023 reported figure of 36 per cent, there are still challenges for Australian businesses trying to access skilled talent.
The OSL evaluates more than 900 occupations at the skill level, including roles within the arts, retail, hospitality and tourism, which guides policies that enhance workforce supply and demand balance and provide key occupations with additional support to help fill critical workforce gaps.
The changes also aim to prevent exploitation and ensure compliance with sponsorship obligations.
The Temporary Skilled Migration Income Threshold (TSMIT) was increased from $70,000 to $73,150 for applications lodged on or after 1 July 2024. This threshold did not include superannuation.
Changes to visa conditions for Subclass 457, 482, and 494 visas allowed temporary migrants to cease working with their sponsor for up to 180 consecutive days or 365 days total during the visa period.
Reforms to the Migration Act strengthened protections for migrant workers reporting workplace exploitation. These measures included non-discretionary protections to prevent visa cancellations for exploited workers, penalties for employers or intermediaries exploiting temporary visa holders, and the introduction of the Workplace Justice Visa (WJV). The WJV allowed temporary migrants involved in workplace justice activities to remain in Australia and work.
The Department of Home Affairs also announced an increased compliance monitoring, conducting announced and unannounced inspections of sponsoring businesses. These inspections focus on pay rates, work hours, visa holder occupations, and other sponsorship obligations.
Implications for employers
These reforms aim to create a more responsive and inclusive migration program and present opportunities for employers to attract talent across a broader range of occupations with streamlined pathways for skilled workers to secure permanent residency.
Employers and applicants should begin preparing for the new system and updated requirements to ensure compliance with the revised migration framework. Key actions could include:
- reviewing the new visa requirements
- assessing financial capacity requirements to meet salary obligations for sponsored workers
- updating HR policies to align with sponsorship obligations.
By understanding these reforms, SMEs can remain competitive in securing skilled talent, streamline operations without workforce reductions, and continue to thrive in Australia’s evolving business landscape.
Dynamic Business Disclaimer: This information is for general guidance only and does not constitute legal advice.
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